If you're registered for GST and running a business as a sole trader, you need to lodge a Business Activity Statement (BAS). For a lot of people, BAS time brings a mix of dread and confusion — what numbers go where, what happens if you're late, and whether you've been putting enough aside throughout the quarter.
This guide walks through every part of the process: what a BAS actually contains, when it's due, how to calculate your GST figures correctly, and how to lodge. It's written for Australian sole traders in 2026-27 using current ATO figures.
Quick answer: As a sole trader, you lodge a BAS quarterly (or monthly if turnover exceeds $20M). The quarterly due dates for 2026-27 are 28 Oct, 28 Feb, 28 Apr, and 28 Jul. You report GST collected from customers, GST paid on business purchases, and any PAYG instalments. Lodge online (through myGov or Online services for business), through SBR-enabled accounting software, or through a registered tax or BAS agent.
This is general information, not tax advice — see your registered tax agent for your specific situation.
What Is a BAS?
A Business Activity Statement is a form you submit to the ATO to report and pay taxes related to your business activity. For most sole traders, it covers:
- GST collected — the 10% GST you charged customers and received
- GST paid (input tax credits) — the 10% GST you paid on eligible business purchases
- PAYG instalments — pre-payments toward your end-of-year income tax (if the ATO has enrolled you)
- PAYG withholding — if you employ staff and withhold tax from their wages
If you're not registered for GST, you don't report GST. You can still receive an activity statement or instalment notice for PAYG instalments or PAYG withholding. Registration becomes mandatory once your GST turnover hits $75,000 in any 12-month period (actual or projected). See ato.gov.au for full details.
How Often Do You Lodge?
Quarterly (most sole traders)
If your GST turnover is under $20 million, you lodge quarterly. This is the default for almost every sole trader.
Monthly
If your GST turnover is $20 million or more, you must lodge monthly.
Annual
Some small businesses with turnover under $75,000 who have voluntarily registered for GST can opt for annual lodgment. If you elect annual reporting, you report and pay GST once a year on an annual GST return, generally due 31 October (or 28 February if you don't have to lodge a tax return). Different dates may apply if you use a registered agent. If you have other obligations, such as PAYG withholding, you still lodge a BAS monthly or quarterly for those.
2026-27 BAS Due Dates (Quarterly)
| Quarter | Period Covered | Due Date |
|---|---|---|
| Q1 | 1 July – 30 September 2026 | 28 October 2026 |
| Q2 | 1 October – 31 December 2026 | 28 February 2027 (a Sunday, so the next business day applies) |
| Q3 | 1 January – 31 March 2027 | 28 April 2027 |
| Q4 | 1 April – 30 June 2027 | 28 July 2027 |
Important: If you lodge online yourself, you may automatically get an extra 2 weeks for quarters 1, 3 and 4 (not quarter 2, whose due date already includes an extension). If you lodge through a registered BAS agent or tax agent, you may get extended due dates. Confirm with your agent or check ato.gov.au for the current lodgment program.
If the due date falls on a weekend or public holiday, you generally have until the next business day. The due date printed on your BAS is the one that applies.
How to Calculate Your GST Figures
This is the part that trips people up most. Here's the maths.
GST Collected (what you owe the ATO)
If you charge GST-inclusive prices, the GST component is calculated using the 1/11th method.
Formula: GST collected = Total GST-inclusive revenue / 11
Example: You ran a cafe and took $33,000 in GST-inclusive revenue for the quarter, all of it from taxable sales. (If any of your sales are GST-free, leave them out before dividing by 11.)
GST collected = $33,000 / 11 = $3,000
That $3,000 belongs to the ATO — it's not your money, you've just been holding it.
GST Paid / Input Tax Credits (what the ATO owes you)
You can claim back the GST you paid on business expenses — supplies, ingredients, equipment, software, fuel and so on — as long as they're for a creditable purpose.
Formula: GST paid = Total GST-inclusive business expenses / 11
Example: You spent $11,000 (GST-inclusive) on packaging, cleaning supplies and equipment during the quarter, all from GST-registered suppliers. (Coffee beans, unflavoured milk and most basic cooking ingredients are GST-free, so there's no GST credit to claim on them.)
GST paid = $11,000 / 11 = $1,000
Net GST Position
Net GST payable = GST collected − GST paid = $3,000 − $1,000 = $2,000 to pay
If your input tax credits exceed GST collected (common when you've bought expensive equipment), you'll get a refund.
What Counts as a Creditable Purchase?
Not every expense is claimable. The purchase must be:
- For a business purpose (not private use)
- From a GST-registered supplier
- Supported by a valid tax invoice if it cost more than $82.50 (GST-inclusive). For smaller purchases, a receipt, docket or invoice is enough
Personal expenses, residential rent, and wages are not subject to GST and cannot generate input tax credits.
PAYG Instalments on Your BAS
If the ATO has enrolled you in PAYG instalments, you'll see a separate section on your BAS (the "T" labels, such as T1, T2 and T7). This is separate from GST.
PAYG instalments are pre-payments of your expected income tax for the year. The ATO automatically enrols individuals (including sole traders) when all three of these apply: instalment income (gross business and investment income, excluding GST and capital gains) of $4,000 or more on your latest tax return, tax payable of $1,000 or more on your latest notice of assessment, and estimated (notional) tax of $500 or more. Other thresholds apply to companies and super funds.
You have two options:
Option 1 — Instalment amount (T7): The ATO calculates a fixed dollar amount each quarter based on your previous return. You pay it unless you vary.
Option 2 — Instalment rate (T1 and T2): The ATO gives you a rate. You apply that rate to your actual income each quarter. More work, but more accurate if your income fluctuates.
You can vary your instalment if you expect your income to be lower than the ATO assumes. Just be careful: if you vary down and your varied instalments come to less than 85% of the tax on your instalment income for the year, you may be charged general interest charge on the difference, and penalties may also apply. See ato.gov.au for current variation rules.
Fuel Tax Credits
If you use fuel in your business for eligible activities — heavy vehicles, machinery, plant equipment, marine vessels, light vehicles off public roads — you may be able to claim fuel tax credits on your BAS.
This is most relevant for primary producers, miners, and businesses running large machinery. Most urban sole traders won't qualify. Check the ATO fuel tax credits page for rates and eligibility.
How to Lodge Your BAS
Option 1: myGov (most sole traders)
- Log in to myGov and link the ATO service
- Open the Lodgments section and find your BAS under "Not lodged"
- Select the open lodgment period
- Enter your GST and PAYG figures
- Review and submit
- Pay any amount owing. BPAY and ATO online services are the quickest options. Card payments are also accepted, but the ATO will stop accepting credit cards after 30 June 2027
Option 2: ATO Online services for business
Online services for business is the ATO's secure website for managing business tax affairs. You log in with a Digital ID such as myID, rather than through myGov.
Option 3: Registered Tax or BAS Agent
A BAS agent lodges on your behalf and often gets extended due dates. If you're spending more time on BAS than you'd like, this is worth considering.
Option 4: Accounting or Bookkeeping Software
Xero, MYOB, and other ATO-integrated software can pre-fill and lodge your BAS directly. Some software connects to the ATO and pulls your transaction data automatically. Summed (mentioned below) handles the BAS prep side — calculating GST collected and paid from your transactions — so your numbers are ready when lodgment time comes.
What Happens If You Lodge Late?
Missing a BAS due date has two consequences:
1. Failure to Lodge (FTL) penalty The penalty is one penalty unit for every 28 days (or part of 28 days) the BAS is overdue, up to a maximum of 5 penalty units. It is multiplied by 2 for medium withholders and by 5 for large withholders. The ATO generally warns you before applying it, and generally doesn't apply it when a late activity statement has a nil or refund result. See the ATO failure to lodge penalty page for details.
2. General Interest Charge (GIC) If you lodge late AND have an amount owing, the ATO charges GIC on the unpaid debt. The GIC rate changes quarterly. See the ATO website for the current rate.
The ATO says it generally doesn't apply penalties for isolated late lodgments, warns you before applying one, and can remit all or part of a penalty if you ask (you'll need to lodge first). But it's far easier to just lodge on time — even if you can't pay immediately. Lodging and paying are separate acts. If you can't pay, lodge anyway and contact the ATO to arrange a payment plan.
Keeping Records
You need to keep all records supporting your BAS for five years. This includes:
- Tax invoices for all purchases you claim input tax credits on
- Records of all sales (invoices, POS reports, bank deposits)
- Receipts for expenses
- Logbooks if claiming vehicle expenses
The ATO generally has 4 years from when you lodge a BAS to review it, so keeping records for five years covers that window.
This is general information, not tax advice. BAS lodgment and PAYG instalment rules change, and the right approach depends on your specific turnover, business structure and ATO correspondence. Speak to a registered tax or BAS agent before lodging if you are unsure. Verify current ATO guidance at ato.gov.au.
Tools That Make This Easier
Tracking GST manually in a spreadsheet works when you're just starting out, but it gets messy fast. By the time you're doing $30,000+ a quarter, you want a system that separates GST-inclusive amounts automatically, tracks which expenses are claimable, and totals everything by quarter so you're not scrambling on lodgment day.
Summed handles BAS prep automatically — try it free for 30 days at $9/mo. Start free →
Related Reading
- Do I Need to Register for GST? The Australian Sole Trader Threshold Explained
- PAYG Instalments for Sole Traders: What They Are, How They Work, and How to Pay
- Sole Trader Tax Deductions Australia 2026-27: The Complete List
FAQ
Q: Do I need to lodge a BAS if I have no income for the quarter?
A: If you're registered for GST, yes — you still need to lodge a nil BAS. It's a five-minute job: enter zeros and submit. If you don't lodge, the ATO will follow up the overdue statement, and a failure to lodge penalty can apply if you ignore its requests.
Q: Can I lodge BAS early?
A: Yes. You can lodge once the quarter has ended and your BAS is available in your online account. If you're well-organised, lodging early means you know your tax position earlier and can plan your cash flow accordingly.
Q: What if I realise I made an error on a lodged BAS?
A: You can correct minor errors on your next BAS (if your GST turnover is under $20 million, the net debit errors you correct this way must total less than $12,500 and be corrected within 18 months of the original BAS due date; errors in your favour have no value limit but must be corrected within the 4-year period of review). For larger errors, you need to revise the original BAS. Do this through the same lodgment channel you used originally, or contact the ATO.
Q: I'm GST-registered but I had a loss this quarter. Do I still pay GST?
A: If your GST collected is more than your input tax credits, yes. A business loss is a separate calculation — it's about income tax, not GST. You could have a loss for income tax purposes but still owe GST.
Q: What's the difference between BAS and tax return?
A: BAS is lodged quarterly and covers GST and PAYG instalments. Your annual tax return is lodged once a year and covers your total income, deductions, and final income tax position. PAYG instalments paid on your BAS are a credit against the tax calculated in your annual return.
Q: Do I pay GST on overseas sales?
A: Generally no — most exports of goods and services to overseas customers are GST-free (no GST is charged). However the rules can be complex for digital services and some other scenarios. Check ATO guidance for your specific situation.
Q: What's the penalty for not lodging BAS at all?
A: The ATO can apply Failure to Lodge penalties, charge general interest on any unpaid amount, and take firmer action if you keep ignoring it. Don't ignore it — even if you can't pay, lodge and call the ATO.
Q: My income is seasonal. Can I vary my PAYG instalments?
A: Yes. You can vary your PAYG instalment amount on each quarterly BAS. Just be careful not to vary too low: if your varied instalments end up below 85% of your actual tax on instalment income for the year, you may be charged general interest charge on the difference (and penalties may apply). If your income is genuinely lower, a well-supported variation is fine.